PARIS Feb 19 Shares in seamless steel tube makers Tenaris and Vallourec tumbled on Wednesday after U.S. trade authorities decided not to impose tariffs on the South Korean imports that compete with their products.
The U.S. Commerce Department launched last July an investigation in response to a petition from the two European companies and others including Northwest Pipe Company. The group complained that manufacturers in South Korea, India and seven other countries were selling the kind of steel pipe mainly used by oil and natural gas producers at unfairly low prices in the United States.
In a preliminary decision dated Feb. 18, the Department of Commerce said it had found dumping of imports from India, the Philippines, Saudi Arabia, Taiwan, Thailand, Turkey, Ukraine and Vietnam, but not from South Korea's Hyundai Hysco and Nexteel Co.
France's Vallourec, which made 29 percent of its sales in North America in 2012, is a big manufacturer of pipes in the United States, having built a $650 million plant in Ohio to bank on the U.S. shale gas boom. It had joined the case against Asian-based manufacturers. Tenaris owns U.S. manufacturer Maverick Tube Corporation.
A spokeswoman for Vallourec noted that the decision was a preliminary one and added "a counter investigation is expected to be launched."
Tenaris and Vallourec stocks were down 5.7 percent and 4.9 percent respectively on Wednesday, making them the biggest losers on Europe's broad STOXX 600 as traders cited the U.S. anti-dumping ruling hitting the sector.
"There was expectation that South Korea would be included, which would have been good news," a Paris-based trader says.
U.S. producers were asking for anti-dumping duties as high as 240 percent on India, 158 percent on South Korea, 118 percent on Thailand and 111 percent on Vietnam to offset what they said was below market pricing, and lesser but still hefty duties on the other countries.
Imports of oil country tubular goods (OCTG) from the nine countries totaled nearly $1.8 billion in 2012, more than double their total in 2010, as rising U.S. oil and natural gas production have increased demand for the pipe. (Additional reporting by Blaise Robinson and Raoul Sachs; Editing by Andrew Callus)